By Rebecca TeKolste
Some recent publications, including books by Anand Giridharadas, Dr. Rob Reich, and Edgar Villanueva, have criticized the philanthropic sector as being another outlet for the wealthiest classes to set priorities in the social sector or a mechanism to obfuscate their role in creating social ills. If the 1/10th of 1 percent of the wealthiest people in the country control the vast majority of philanthropic wealth, they can set the social impact agenda in yet another way.
But new forms of philanthropy have emerged in the last decade that hope to change the game in philanthropy. Crowdfunding in particular has been seen as a way for small dollar donors to make collective contributions and, in doing so, shape the collective philanthropy agenda.
Our new report explores current research available on the state of the crowdfunding field.
In general, crowdfunding strategy has focused on the idea that nonprofit organizations of all types and sizes can participate and benefit from raising funds through this mechanism. In this sense, crowdfunding attempts to democratize philanthropy, channeling donations away from exclusively large multinational NGOs, and toward smaller organizations that have traditionally not received such a large donation base.
But does it? And can #GivingTuesday be a mechanism to encourage inclusion? Some research suggests that when donors are presented with all options at once, they may select the organizations that they know best already.
What does this mean for #GivingTuesday? Well, since #GivingTuesday offers donors multiple options in a single day, it might display an ingrained preference for larger, better known organizations. If the goal truly is more organizational inclusion, what strategies can #GivingTuesday organizers and donation platforms employ to encourage more organizational equity in donations? Our future research will address this gap.
In the same vein, research on crowdfunding has asked questions about donor identity and inclusion in some areas. For example, our report on women in crowdfunding looks at gender differences in giving online. And our Women Give 2019 report focuses on the intersectionality regarding how women of diverse racial identities give differently, but we’ve not yet combined the two questions. We haven’t asked whether crowdfunding has reached individuals, such as women of color, who have traditionally been left out of other kinds of fundraising.
Despite the breadth of literature on what kinds of targeted outreach works best in crowdfunding efforts, the research also leaves out some questions about the democratization of philanthropy. One reason for this gap is because crowdfunding platforms may not be able to share donor information with nonprofits, which means organizations can’t look at their #GivingTuesday donors and compare with their existing donor base to see if #GivingTuesday is bringing new players to the table.
Our new report lays out a research agenda that will circumvent these longstanding challenges to respond to these important questions about crowdfunding as an agent to create a more inclusive philanthropy. Based on our findings in the literature, our future priorities will include a greater understanding of the ways crowdfunding can positively impact:
- Equity and inclusion in the donor base.
- Visibility of smaller organizations.
- Inclusive philanthropic priorities.
Online giving and crowdfunding are new areas of philanthropy that are becoming increasingly important to the overall philanthropic picture. This means understanding their equity impact is increasingly important as the use of these mechanisms grow.
Read our current report on the state of the field. And stay tuned for more in-depth research on crowdfunding in the months to come.
A “Boomerang Hoosier,” TeKolste received a B.A. from Northwestern University and an M.A. from Yale University, and is a proud Returned Peace Corps Volunteer. She now works for the DCCC in the 5th district of Indiana and teaches the Lilly Family School of Philanthropy course entitled “Philanthropy and Civic Engagement.”